Opinion: Inflation Isn’t The Answer

Americas columnist Mary Anastasia O’Grady on why inflation is back in vogue as the way to solve our nation’s economic woes. Photo: Harvard.edu

This transcript has been automatically generated and may not be 100% accurate.

... I ... I ... the ... the reserve of little less than an hour from our studios their latest policy statement and I assume they're going to tell us that the uptrend presses are still running Mary Anastasia O'Grady thanks for joining us ... I'm sure there's can be a lot of news today but really the news the larger news you've been tracking is that inflation which Americans learn baking in the seventies is ... making a comeback at least its ... intellectual of supporters ... write an academic circles it seems like now there are more in our arguments for ... I in him for not keeping the price level constant ... as a way to ... help ... juice the economy to bring down unemployment and so forth and of course the leader of this ... on intellectual movement is can grow bathrooms and ... a professor of economics professor at Harvard ... on he's been reading since two thousand ate ... anything say I'm good dose of a burst ... of high inflation would be good for the economy and of course what we know from ... on the matter of public says that if you have that I'm ... a big debt overhang ... and you have a burst of inflation that helps debtors because what they borrowed his last words last week as adopted in the currency is inside de valued the ... business ... we think of this is a failed nineteen seventies experiment in Ohio in the United States but obviously ... covering the Americans is you do ... this is been tried a lot of time since then and then I think it's ... fair to say the record is of blemish by success ... well the difference I think here is that well off actually believes that you can ... choose an inflation level that is not too high and not too low and in you can target and that you know you can you can get there you can get rid of the debt overhang you have ... any people happily on your way and I think in as much as the installation itself on redistributes wealth and punishing savers and investors ... the other thing that it that this is our dear thing that we should be worrying about with his plan is what happens if the Fed can control one in the record is ... that ... because monetary policy ... I'm ... a and the effects of monetary policy have long and variable axed ... by the time and then ... guys who are working the letters trend figure out that there's an inflation probably take some a long time to catch up so ... the idea that you can targets a six percent inflation which is what he likes ... I think is I'm not been proven by any body but just emphasize the point you're making about how long this is ... seen as a way to get rid of debt overhang another witness at the end of this he said is redistributing wealth from people love to lend money to people who are aware that leads to the ... fixed rate ... right money he what I think you would argue that that's the least painful way to get out of the broader economic problem but ... he admits that either something unfair about that ... on the also admits that dot inflation could spin out of control when you may need the brunt of twenty or thirty percent but don't worry we can discern of ... using the tools that the Fed Haim bring in right back and there's also such an evidence for it for that offsets also I guess we'll go but it's also funny growth write a mean what's to stop the printing presses the ... assets on some fronts come back to earth ... eventually you have to add you know taken up the money supply and that usually puts you also backed into a ... another recession so aam ... it ... it ... did in Salter from short term but it creates a lot about other problems and problems that are very I'm just the people who have played with animals okay well maybe eventually the politicians will give us